A mortgage strategy for the Trump years ahead and other 2025 money tips from advisers and planners

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Welcome to personal finance’s year of Donald Trump.

Asked on LinkedIn to provide their best ideas for 2025, planners, advisers, mortgage agents and other financial industry people referred over and over to Mr. Trump. There was a mortgage strategy for dealing with uncertainties in the Trump presidency, which begins with his Jan. 20 inauguration. Also, thoughts on realistic investing assumptions, mindful spending and keeping calm amid troubling financial news. Let’s look thematically at what was said.

Mortgages

If Mr. Trump’s economic policies result in higher inflation, it’s possible we could end up with higher mortgage rates here in Canada. “A five-year fixed mortgage term would allow the mortgage holder to fully ride out the next presidential term with zero rate fluctuations,” mortgage agent Jesse Merson wrote.

Mr. Merson said three-year fixed-rate mortgages have been the most popular lately because they have lower costs, but he added that their advantage over the five-year rate is shrinking. With inflation risk easing, longer-term interest rates are coming down

Marshall Tully, a mortgage broker, suggested borrowers look into restructuring their mortgage if they’re locked into a rate of 5.5 per cent or higher with two-plus years left on the loan. “There are some significant opportunities to save money, reduce interest costs, or even shave years off your term,” he wrote.

Realistic investing assumptions

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Consecutive years of great stock-market returns can dull your sense of risk, a point several planners addressed in their comment.

“A well-crafted financial plan uses conservative assumptions regarding the rate of return and inflation over the long term,” wrote Tina Tehranchian, a senior wealth adviser at Assante Capital Management who was recently appointed to the Order of Canada. “As long as you are on track to achieve your long-term goals, there is no need for you to chase short-term returns.”

Adam Weersink, a financial planner and portfolio manager, reminded investors to think about rebalancing portfolios where high-flying stocks may be crowding out bonds. “But that’s where meddling with your portfolio should stop,” he wrote. “Easy for us north of the border to overthink what changes we should make in our portfolios due to the ‘Trump Effect,’ but the reality is that if your asset allocation was appropriate before Trump, it’s appropriate after Trump.”

Spending

The economic uncertainty caused by Mr. Trump’s threat of a trade war with Canada prompted Susan Thomas, Haventree Bank’s vice-president of sales, to suggest people think about cutting back on spending. “There is power in saying, ‘I can’t afford it.’ People don’t like to admit that, whether it is attending a destination wedding or simply going to a restaurant with friends. We need to normalize that phrase.”

Wendy Brookhouse, founder and chief strategist at Black Star Wealth, said she develops a spending plan for clients as part of her planning process. Ms. Brookhouse suggests people ask three questions about a purchase: is it worth it, do I have to buy it right now and am I buying it for the right reasons?” I find these three questions help them understand whether it is worth going off plan for something,” she wrote.

Jeffery Lamont, a financial adviser for lawyers, said trade tensions created by Mr. Trump’s policies could lead to higher costs, sustained high interest rates and increased financial market volatility. “I’ve been suggesting to clients that they reassess their budgets, look at potentially tackling debt more aggressively and keep building that emergency fund war chest, because we are likely in for a bumpy ride.”

Staying calm while preparing for financial setbacks

Financial planner Hervin Pesa said that while there will be a lot of talk about change and unprecedented events in 2025, the basics of personal finance remain the same. “Stay invested, stay focused and stay in control of the things you can control,” he wrote.

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Aravind Sithamparapillai, an associate with Ironwood Wealth Management, focused on risks to your job and income as a result of layoffs. He suggested caution if you’re leaving a job where you have seniority for a new position with a pay increase. “If you take that jump, you may want to juice your emergency fund,” he wrote.

Sun Life Financial Inc.’s Thomas Wimmer urged people to keep investing regularly and to ignore the commotion if there’s a stock-market correction. If stocks fall, “be ready with cash.”

Miscellaneous other thoughts

“January is always a good time to examine your relationship with your adviser. Ask yourself what’s working and what isn’t – beyond investment returns.”

– Samantha Sykes, senior investment adviser at Raymond James.

“It never fails to surprise me when we work with new clients how many successful professionals and entrepreneurs are lacking a will and proper insurance coverage.”

– Marcelo Taboada, adviser and associate portfolio manager

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